Bank deposit interest rates surpass 10%
In this article (5)
Some banks have hiked deposit interest rates to 10-10.35% amid low liquidity in the system. NCB is paying the highest interest rate of 10.35% for 12-month deposits of VND1 billion (US$40,300) downwards made online. For six-month deposits, it is offering 10%. Over the past month, lenders have increased deposit interest rates frequently, even weekly in some cases.
At least ten banks are now offering more than 9% deposit interest rates. Most have also launched promotions offering higher rates than officially listed to attract depositors. MSB is offering 9.9% to new clients if they place a deposit of at least VND1 million.
Many, including Kienlongbank, GPBank, BaoVietBank, PGBank, OCB, VPBank, VietBank, Sacombank, and SeABank, are paying over 9% for 12-month deposits. Public banks are offering around 8% for 12 months.
For periods of below six months most banks are paying around 6%. Banks lack liquidity and so have had to sharply hike the rates to meet the needs of business borrowers, Nguyen Quoc Hung, general secretary of the Vietnam Banks Association, said.
The director of a large bank said the tightened bond and property markets mean some lenders have to increase deposit interest rates to ensure liquidity steeply.
In the last two months, interest rates on deposits of six months or more have increased by 1.5-2.5 percentage points, leading to higher lending interest rates. Floating interest rates are predicted to soon surge to 15% yearly for individual borrowers and 11-12% for businesses.
Now they are around 13% and 9%.
Questions & Answers
Q.Which bank currently offers the highest deposit interest rate mentioned in the article?
Which bank currently offers the highest deposit interest rate mentioned in the article?
NCB is offering the highest interest rate, reaching 10.35%. This applies to 12-month online deposits of VND1 billion (US$40,300) downwards, specifically for customers placing funds online.
Q.What is the reason given for banks needing to increase their deposit interest rates?
What is the reason given for banks needing to increase their deposit interest rates?
Banks lack liquidity and have needed to sharply hike rates to meet the needs of business borrowers. This situation is further exacerbated by tightened bond and property markets, forcing some lenders to increase rates steeply.
Q.How have deposit interest rates for longer terms changed recently?
How have deposit interest rates for longer terms changed recently?
Over the last two months, interest rates on deposits for six months or more have increased by 1.5-2.5 percentage points. This frequent increase has sometimes occurred weekly at various lenders.
Q.What are the predicted future floating interest rates for individual and business borrowers?
What are the predicted future floating interest rates for individual and business borrowers?
Floating interest rates are predicted to soon surge to 15% yearly for individual borrowers. For businesses, these rates are expected to increase to 11-12%, up from their current approximate levels.
Reader pulse
How will higher bank interest rates impact your retail business?
22,351 votes so far